What made Uber win in China?

According to the report, Uber's investors in China will get 20% stake in the entity after the merger. Didi Chuxing has also consented to make a $1 billion investment in Uber.Chhavi Tyagi | ET Online | Updated: August 02, 2016, 09:54 IST

What made Uber win in China?After bleeding profusely for three years and still failing to gain a lead in a highly competitive market that is China, Bloomberg on Monday said Uber would be selling its China subsidiary to local rival Didi Chuxing.

According to the report, Uber's investors in China will get 20% stake in the entity after the merger. Didi Chuxing has also consented to make a $1 billion investment in Uber. Didi had entered in to an alliance with Indian local e-hailing company Ola in 2015, along with US-based Lyft and Southeast Asia's Grab in a bid for global control. We bring you the reasons that forced Uber to yield to Didi after a long bloody battle:

A race of heavy losses: For three years, Uber had reportedly spent a massive $1billion a year in its race to gain territory in China.

Losses trumping profit: Even though Uber had declared profitability in the US and Canada, heavy losses in China proved a heavy drain.

IPO delayed: While heavy investments have fed the expansion needs of the global company; experts believe that heavy losses in China have also prevented the company from going for a public listing.

Investor pressure: Bloomberg had earlier reported that Uber backers have been pushing the company to settle for a truce with the local leader. Both companies have been raising heavy funding in order to acquire the majority market share - Didi raised $7 billion in June 2016, only a month after a $1 billion funding from Apple while Uber rasied $3.5 billion.

Local clique: In 2015, China's local e-hailing players Didi Dache (backed by Chinese internet giant Tencent Holdings) and Kuaidi Dache (backed by Alibaba Group) joined hands in a bid to counter Uber's growing influence. The combined forces proved too big for Uber to continue the fight.

Failure to lead the market: Even after raising and investing billions of dollars, Uber had failed to go beyond its 30-35% share in the Chinese market. The percentage is contested by Didi which claims to possess 80% of the market.

Didi's investment: Uber's global playbook is to pump in money till competition is exhausted. However, Didi with the backing of Tencent and Alibaba has shown an equal zeal in raising funds. Most recently, Didi raised $7.3 billion which included $1 billion from Apple.

Too many battles: Uber has been fighting battles in too many countries. From regulatory hurdles to tackling local players like Ola in India, Uber had too many battles to fight. With China settled, it can focus on markets like India where the gap with market leader Ola is much narrower.